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Testimony:
Before the Subcommittee on Railroads, Committee on Transportation and
Infrastructure, House of Representatives:
United States Government Accountability Office:
GAO:
For Release on Delivery Expected at 10:00 a.m. EDT:
Wednesday, May 11, 2005:
AMTRAK:
Acela's Continued Problems Underscore the Importance of Meeting Broader
Challenges in Managing Large-Scale Projects:
Statement of JayEtta Hecker, Director, Physical Infrastructure Issues:
GAO-05-698T:
GAO Highlights:
Highlights of GAO-05-698T, a report to Subcommittee on Railroads,
Committee on Transportation and Infrastructure, House of
Representatives:
Why GAO Did This Study:
In 1996, the National Railroad Passenger Corporation (Amtrak) executed
contracts to build high-speed trainsets (a combination of locomotives
and passenger cars) as part of the Northeast High Speed Rail
Improvement Project. Since that time, Amtrak has experienced multiple
challenges related to this program, including recently removing all
trains from service due to brake problems. Amtrak has struggled since
its inception to earn sufficient revenues and depends heavily on
federal subsidies to remain solvent. The April 2005 action to remove
the Acela trainsets—Amtrak’s biggest revenue source—from service has
only exacerbated problems by putting increased pressure on Amtrak’s
ridership and revenue levels.
This testimony is based on GAO’s past work on Amtrak and focuses on (1)
background on problems related to the development of the Acela program,
(2) summary of issues related to lawsuits between Amtrak and the train
manufacturers and the related settlement, (3) key challenges associated
with the settlement, and (4) initial observations on possible
challenges in Amtrak managing large-scale projects.
What GAO Found:
Significant issues and controversy have impacted the Acela program
since its inception. According to Amtrak, what started out as a simple
procurement of train equipment evolved into a complex high-speed rail
program. Acela has encountered numerous difficulties due to such things
as new technology and production delays. Even after Acela service
began, unexpected problems were encountered, which required Amtrak to
remove the trainsets from service, resulting in lost revenue.
Concerns about the quality of the Consortium of train manufacturers’
(Bombardier and Alstom) work and Amtrak’s withholding of payments for
the Acela trainsets resulted in the parties suing each other, each
seeking $200 million in damages. Amtrak and the Consortium reached a
negotiated settlement in March 2004. Although the settlement agreement
protects Amtrak through certain warranties, loss of revenue resulting
from removal of trains from service is not directly recoverable. Under
the settlement, Amtrak is conditionally scheduled to assume maintenance
functions from the Consortium in October 2006.
Aside from the current problems, Amtrak faces other risks and
challenges to the recent settlement, including obtaining technical
expertise and providing sufficient funding for maintenance. Achieving a
successful transition is critical to Amtrak given the importance of the
Acela program. The recent brake problems may impact the transition
through such things as delayed management training.
As GAO reported in February 2004, Amtrak had difficulties managing the
Northeast High Speed Rail Improvement Project and many critical
elements of the project were not completed and the project goal of a 3-
hour trip time between Boston and New York City was not attained. GAO
has ongoing work addressing Amtrak management and performance issues
that GAO plans to report on later this year.
Timeline of key events:
[See PDF for image]
[End of figure]
www.gao.gov/cgi-bin/getrpt?GAO-05-698T.
To view the full product, including the scope and methodology, click on
the link above. For more information, contact JayEtta Z. Hecker, (202)
512-2834, heckerj@gao.gov.
[End of section]
Mr. Chairman and Members of the Subcommittee:
I appreciate the opportunity to testify on the National Railroad
Passenger Corporation's (Amtrak) Acela program and the overall
management of the corporation. Intercity passenger rail is at a
critical crossroads regarding its future in the United States. Amtrak
has struggled since its inception to earn sufficient revenues and
depends heavily on federal subsidies to remain solvent. The April 2005
action to remove the Acela trainsets--the combination of locomotives
and passenger cars--from service has only exacerbated problems by
putting increased stress on Amtrak's ability to maintain ridership and
revenue levels and could make Amtrak's financial condition even more
precarious. Amtrak's Acela program accounted for not quite one-fourth
of the ridership and about 44 percent of revenue on the Northeast
Corridor--Amtrak's busiest rail route--in fiscal year 2004.
My statement today addresses numerous issues of interest to the
Congress as it delves into Amtrak's handling of this most recent
incident involving Acela, and more generally, the future of intercity
passenger rail in this country. I will cover four areas: (1) background
on the problems Amtrak experienced during the development of the Acela
program, (2) a summary of issues related to the lawsuits between Amtrak
and the consortium of train manufacturers (the Consortium), Bombardier
and Alstom, and the subsequent settlement, (3) key challenges
associated with implementing the settlement, and (4) possible broader
challenges at Amtrak in managing other large-scale projects. The
information I will present is primarily based on reports that we have
issued over the last several years.[Footnote 1]
Significant issues and controversy have impacted the Acela program
since its inception. Among the issues that have impacted the Acela
program are the following: (1) potential difficulties due to new
technology, (2) impacts from new safety standards to accommodate high-
speed rail, (3) manufacturing and production delays, and (4)
abbreviated testing of the trains prior to placement in revenue
service. The Acela trainsets are not an "off-the-shelf" piece of
equipment but rather a combination of both new and existing technology.
According to the Federal Railroad Administration (FRA), this was the
first time this particular combination of new and existing technology
had been designed as one unit. As such, the equipment required
considerable time to develop and test, and the probability of expected
and unexpected problems was high. Furthermore, the trainset grew in
weight and cost due to new safety regulations. The Consortium also
encountered production delays. With Amtrak under considerable financial
and time pressures to place the trainsets into service; therefore,
trainset testing was abbreviated. In addition to building the Acela
trainsets, the Consortium entered into a contractual arrangement with
Amtrak to manage the Acela facilities and maintain the trainsets,
including training and supervising Amtrak employees. Since the
trainsets were placed into revenue service in 2000, unexpected problems
have been encountered that have resulted in lost revenue and damaged
the image of the Acela program. For example, an equipment failure
forced Amtrak to withdraw the Acela trainsets from service for 2 months
in 2002. As problems and difficulties mounted, increased tension
between Amtrak and the trainset manufacturer led to legal action
against each other.
* Concerns about the quality of the Consortium's work and Amtrak's
withholding of payments for the Acela trainsets resulted in the parties
suing each other, each seeking $200 million in damages. Amtrak and the
Consortium reached a negotiated settlement in March 2004. In general,
under the settlement, the Consortium must complete modifications to the
trainsets and locomotives, achieve established performance
requirements, provide training to Amtrak staff, and provide and extend
warranties. In addition, Amtrak agreed to release a portion of
previously withheld funds and will conditionally assume facility
management and trainset maintenance responsibilities as soon as 2006,
rather than in 2013, as originally planned; if the Consortium
satisfactorily completes its commitments under the settlement
agreement.
* Our work evaluating the terms of the settlement led us to conclude
that Amtrak faces other risks and challenges to sustain the trainsets
and keep them operating.[Footnote 2] Achieving a successful transition
is critical to the financial well-being of Amtrak, given that the Acela
program is such a significant source of its revenue. The challenges
include (1) completing modifications and meeting performance
requirements, (2) obtaining technical expertise for maintenance and
completing training, (3) sufficiently funding maintenance and
integrating responsibilities, and (4) preparing a comprehensive
implementation plan. Addressing and resolving these challenges will not
be easy. Although the settlement agreement ensures that Amtrak will be
protected by the extended trainset warranties and Amtrak has several
methods of financial recourse if the Consortium does not honor
warranties, loss of revenue resulting from removal of trainsets from
service is not directly recoverable. However, the full extent of the
legal liability has yet to be addressed by the parties. Amtrak
officials told us that their first priority is getting the trainsets
back in service. In addition, the recent brake problems may impact the
transition of the maintenance function to Amtrak through such actions
as delaying management training. Amtrak officials continue to believe
the transition will occur in October 2006, however.
* Amtrak also faces challenges in managing other large-scale projects.
As we reported in February 2004, Amtrak had difficulties managing the
Northeast High Speed Rail Improvement Project (NHRIP), a multi-year,
multi-billion dollar project to electrify the tracks between Boston,
Massachusetts, and New Haven, Connecticut, acquire high-speed trains,
and make capital improvements. Among the problems we found were that
(1) Amtrak's management of this project was not comprehensive but was
focused on the short term; (2) project management focused on separate
components of the project, such as electrification and acquisition of
the high-speed trains, and not on the project as a whole; and (3)
Amtrak did not sufficiently address major infrastructure improvements
needed to attain project goals. The overall results were that many
critical elements of the project were not completed, project costs and
schedules increased considerably, and the project goal of a 3-hour trip
time between Boston and New York City was not attained.
Background:
The Rail Passenger Service Act of 1970 created Amtrak to provide
intercity passenger rail service because existing railroads found such
service to be unprofitable. Amtrak operates a 22,000-mile network,
primarily over freight railroad tracks, providing service to 46 states
and the District of Columbia. Amtrak owns about 650 miles of track,
primarily on the Northeast Corridor between Boston, Massachusetts, and
Washington, D.C. In fiscal year 2004, Amtrak served about 25 million
passengers, or about 68,640 passengers per day. According to Amtrak,
about two-thirds of its ridership is wholly or partially on the
Northeast Corridor. The Northeast Corridor is the busiest passenger
rail line in the country, and some 200 million Amtrak and commuter rail
travelers use the Corridor, or some part of it, each year. On some
portions of the Northeast Corridor, Amtrak provides high-speed rail
service (up to 150 miles per hour). The high-speed Acela program is the
centerpiece of Amtrak's intercity passenger rail system, with its
financial contributions to the company exceeding that of all other
routes combined.
Acquisition of the Acela trainsets occurred as part of NHRIP. NHRIP,
and its predecessor the Northeast Corridor Improvement Project, date
back to the late 1970's and represented a multiyear, multibillion
collection of capital improvements to the Northeast Corridor that
included electrifying the line between New Haven, Connecticut, and
Boston, Massachusetts, improving tracks, signals, and other
infrastructure, and acquiring high-speed trains.[Footnote 3] These
efforts were designed to achieve a 3-hour trip time between New York
City and Boston. As of March 2003, Amtrak, commuter railroads, and
others had spent about $3.2 billion on the project.
In 1996, Amtrak executed contracts with train manufacturers Bombardier
and Alstom to build 20 high-speed trainsets and 15 electric high-
horsepower locomotives; construct three maintenance facilities; and
provide maintenance services for the Acela trainsets. The trainsets,
locomotives, and facilities contracts totaled $730 million.[Footnote 4]
Bombardier and Alstom, referred to as the Consortium, created the
Northeast Corridor Management Service Corporation (NecMSC) to manage
the facilities and maintain the trainsets, including supervising Amtrak
maintenance employees. Amtrak pays NecMSC a per-mile rate--that is, a
fixed rate for each mile the Acela trains travel--on a monthly basis to
provide management and maintenance services at three maintenance
facilities.[Footnote 5]
Amtrak's Acela program has undergone a number of events since its
inception, which has included the execution of the original contracts
in 1996, delivery of the first trainset in October 2000, and the filing
of lawsuits by both Bombardier and Amtrak in November 2001 and 2002,
respectively(see fig. 1). The trainsets were also withdrawn from
service for several weeks in August 2002. In March 2004, Amtrak and
Bombardier signed an agreement to settle the lawsuits, which calls for
Amtrak to conditionally assume trainset maintenance in October 2006,
assuming conditions of the settlement have been met. The last
warranties for the trainsets expire in 2021.
Figure 1: Timeline of key events:
[See PDF for image]
[End of figure]
Significant Issues Have Impacted Acela Program Since Its Inception:
Significant issues and controversy have impacted the Acela program
since its inception. What started out as a relatively simple
procurement of train equipment evolved into a complex high-speed rail
program, according to an Amtrak official. The Acela trainset is a
complex piece of equipment with state-of-the-art electronics and was
considered new technology for the United States. As such, it required
additional time to develop and test, and the probability of expected
and unexpected problems was high.
Among the issues that the Acela program has encountered since its
creation are the following:
* Potential difficulties due to new technology. Instead of purchasing
"off-the-shelf" technology--that is, train equipment that was already
designed, engineered, and in use--Amtrak decided to acquire "new"
technology. An FRA official told us some components on the Acela
trainset (such as power components and the tilt mechanism[Footnote 6])
were similar to that used on train equipment in other parts of the
world but much of the technology on Acela trainsets was new. In
addition, many of the components, whether new or existing technology,
had never been used together. Further, this official said that because
the components in the Acela trainsets had never before been designed as
one unit, Acela was not an off-the-shelf technology train.[Footnote 7]
Although Acela trainsets were essentially new technology and could be
expected to require additional time to develop and test, Amtrak
developed an ambitious schedule that called for shipment of the first
trainset 32 months--just over 2½ years--after the notice to proceed was
issued. According to an Amtrak official, the calendar and
electrification delivery date drove the planning for the trainsets.
Amtrak worked backwards from these due dates to try and fit project
work into the timeline.
* Impacts from new safety standards to accommodate high-speed rail.
During the 1996 to 2000 time frame, the same time period when the Acela
trainsets were being acquired and manufactured, FRA, in consultation
with Amtrak, was developing safety regulations related to high-speed
rail operations. These included new rules covering track safety (to
accommodate speeds of up to 200 miles per hour), passenger car safety,
and train control. According to FRA officials, Amtrak was intimately
involved in developing these standards to accomplish its vision of high-
speed rail operations on the Northeast Corridor. FRA officials also
noted that passenger car safety regulations did not exist prior to the
mid-1990's. Developed for safety purposes, these standards had a
significant impact on the Acela trainsets. For example, the passenger
car safety regulations required a crash energy management system in
passenger cars that was designed to increase the strength of both car
ends and side posts. FRA also prohibited the operation of high-speed
trains (up to 150 miles per hour) in a push-pull manner.[Footnote 8]
FRA officials acknowledged that the crash energy system increased the
weight of the Acela trainsets but said such a system resulted in safer
trains. Amtrak told us that prohibiting push-pull operation caused them
to obtain 20 additional power cars for Acela at a cost of about $100
million.
* Manufacturing and production delays. The Acela program experienced a
significant share of manufacturing and production delays. Under FRA's
1994 master plan for NHRIP, developed in response to the Amtrak
Authorization and Development Act, delivery of enough high-speed trains
to initiate limited 3-hour service between Boston and New York City was
expected by 1999.[Footnote 9] However, due to design and manufacturing
delays, the first Acela trainsets were delivered about a year late, and
revenue service using the trainsets did not begin until December 2000.
Manufacturing and production delays began early in the procurement
process. For example, our review of Consortium progress reports
indicated that as early as October 1996, only months after the original
contract was signed, change orders and design changes (mainly related
to car interiors) were being made that were causing delays in
production. In addition, train weight was increasing, a condition that
continued to plague the trainsets throughout production. Amtrak
attempted to require the Consortium to prepare recovery plans to keep
the program on schedule, but we found little evidence of such plans in
documents we reviewed. Regardless, these plans did not prevent the
trainsets from being delivered about a year late.
* Abbreviated testing prior to placement in revenue service. Amtrak's
Acela trainsets also appeared to have had abbreviated testing prior to
being deployed into revenue service.[Footnote 10] A fuller testing of
the trainsets may have better identified the range of potential
problems and defects that could be experienced prior to placing the
trainsets in service. The maximum testing any one Acela trainset
received was about 35,000 miles of testing--20,000 miles at the
Transportation Test Center (Center) in Pueblo, Colorado, and 15,000
miles on the Northeast Corridor between 1999 and 2000. However, an FRA
official believed testing of the trainsets was rushed and that
additional testing at the Center should have been conducted.[Footnote
11] This official cited testing of Amtrak's AEM-7 electric locomotive
as an example of the testing that is normally done on new equipment.
This locomotive, which was a new locomotive that entered service in the
early 1980's, was tested for 165,000 miles at the Center prior to
placement in service. An FRA official also acknowledged that there were
no minimum federal testing requirements for new high-speed trainsets,
like Acela, only that such equipment comply with existing safety
regulations.[Footnote 12] However, this official believed Amtrak was
under both financial and time pressures to place the trainsets in
service, in part because of delays in trainset production.
Since placement into revenue service in 2000, the Acela has experienced
a number of unexpected problems. One occurrence was in August 2002 when
Amtrak was forced to withdraw the trains from service to address
unexpected equipment problems (yaw damper brackets). The trainsets were
not returned to complete service until October 2002. According to
Amtrak, this withdrawal cost the corporation a net $17 million in lost
revenue. In April 2005, Amtrak once again experienced unexpected
problems with the trainsets due to equipment problems (cracks in brake
assemblies). Again, the trainsets have been withdrawn from service and
Amtrak has stated that it may be months before the trains are returned
to service. Although Amtrak is placing substitute equipment into
service, it can be expected that there will be revenue loss as well as
damage to Amtrak's image.
Legal Suits between Amtrak and the Acela Manufacturer Led to Settlement
Agreement in March 2004:
As the procurement proceeded, tensions grew between Amtrak and the
Consortium. Concerns about the quality of the Consortium's work and
Amtrak's withholding of payments for the Acela trainsets resulted in
the parties suing each other, each seeking $200 million in damages. In
November 2001, Bombardier filed a suit alleging that Amtrak improperly
withheld payments, failed to provide accurate information on
infrastructure conditions, and changed design specifications during
contract performance. In November 2002, Amtrak filed a suit alleging
that the Consortium failed to meet trainset performance requirements.
In addition, Amtrak alleged that the engineering was deficient,
workmanship was poor, program management and quality control were
inadequate, and the Consortium did not meet contract delivery
schedules.
Amtrak and the Consortium reached a negotiated settlement in March
2004, ending their legal dispute surrounding the Acela
trainsets.[Footnote 13] As part of the settlement, Amtrak agreed to
release a portion of the previously withheld funds to the Consortium
and conditionally assume facility management and trainset maintenance
responsibilities as soon as October 1, 2006, rather than in 2013, as
originally planned. In general, under the settlement, the Consortium
must complete modifications to the trainsets and locomotives; achieve
established performance requirements for reliability, speed, and
comfort; provide training to Amtrak staff; and provide and extend
warranties (see fig. 2). The Consortium is also responsible for the
transfer of technical information, rights to third-party contracts,
parts information, permits, and licenses to Amtrak. In addition, the
settlement requires that the Consortium provide technical services and
information technology updates even after the transition date. Amtrak
is required to create a transition plan, hire staff to manage the
facilities and maintain the trainsets, and determine a parts
procurement plan for the trainsets.
Figure 2: Settlement responsibilities:
[See PDF for image]
[End of figure]
Acela Program Still Faces Considerable Challenges:
Independent of the Acela brake problem being discussed today, Amtrak
faces other risks and challenges to sustain the trainset and keep it
operating efficiently. Achieving a successful transition is critical to
the financial well-being of Amtrak given that the Acela program is such
a significant source of its revenue. A successful transition of
maintenance and management responsibilities for the Acela trainsets
depends on whether Amtrak and the Consortium can address the numerous
challenges. Key challenges include:
* Achieving trainset modifications and performance requirements. The
Consortium must complete an extensive list of modifications to the
trainsets, some of which are complex, before Amtrak will assume
maintenance responsibilities. Although the Consortium has closed three-
fourths of the items, they are behind schedule on completing the work
on some remaining items. Amtrak has identified certain modifications
that potentially may not be completed by October 1, 2006, and has
concerns that other modifications may affect service reliability. The
Consortium is also responsible for ensuring that the trainsets continue
to meet reliability, speed, and comfort performance requirements. The
trainsets have not yet met the minimum reliability performance
requirement of traveling an average 17,500 miles between service
failures.[Footnote 14] According to Amtrak, the period of time when the
trainsets are out of service to resolve the brake problems will not
likely be included in the measurement of this standard.
* Obtaining technical expertise for maintenance and completing
training. Amtrak must secure a workforce with the technical expertise
needed to maintain the trainsets. To achieve this, Amtrak is developing
a new High Speed Rail Division to assume management and maintenance
responsibilities, and it plans to hire at least 50 percent of NecMSC's
current staff to benefit from their knowledge and expertise. The
Consortium and Amtrak must also develop and implement training programs
needed to maintain the complex trainsets after the transition. The
trainsets are technically complex and require considerable expertise to
identify and make needed repairs and to troubleshoot difficult
maintenance problems. According to Amtrak officials, ensuring that
technicians are properly trained is one of the most critical points of
the transition. As a result of the current brake problem, Amtrak is
reevaluating its training materials. Based on the latest progress
report (March 2005), troubleshooting training is slightly behind
schedule, and Amtrak officials told us that management training has
been temporarily delayed due to the brake problem. Under the transition
plan, training is scheduled to be completed by October 1, 2005.
* Sufficiently funding maintenance and integrating responsibilities.
Once the transition occurs, Amtrak will be responsible for maintenance
costs to ensure continued trainset performance, including procuring
parts and performing overhaul maintenance. Amtrak has experienced
problems in the past with delays in completing the maintenance
necessary to provide its conventional service; and if these problems
continue, they could affect trainset performance and availability for
revenue service. At the time of our review, Amtrak had not determined
the level of funding necessary to provide regular maintenance and
overhauls to the trainsets. Amtrak officials stated that despite the
uncertainty of maintenance costs once the transition occurs, they
estimate that the costs of managing the maintenance in-house will be no
greater than the costs of paying NecMSC to perform the work. We believe
the uncertain amount of future maintenance costs and possible lack of
adequate funds may have a greater impact than anticipated. Amtrak must
also successfully integrate the new maintenance responsibilities into
its current organization. Development of a new division requires
strategic planning, communication, and performance management. This may
prove difficult for Amtrak as our past and ongoing work has shown its
shortcomings in managing large-scale projects.
* Preparing a comprehensive implementation plan. Creating a
comprehensive implementation plan that provides a blueprint of
important steps; milestones; contingency plans if milestones are not
met; measures for achieving results; and funding strategies will be
important for a successful transition. Amtrak has created a critical
path schedule for monitoring the status and completion of open items
related to the settlement and holds regular meetings, both internally
and with the Consortium, to discuss progress and issues that arise.
Although Amtrak has taken actions to address the key challenges related
to the settlement, these actions did not represent a comprehensive
implementation plan, and we recommended in our December 2004 report
that Amtrak develop such a plan that encompasses all aspects of the
transition in order to ensure a successful transition. We also said
that such a plan should include contingency plans, if milestones are
not met. In light of recent events, we believe a comprehensive plan
that identifies contingency actions could provide the steps necessary
to help prevent postponement of the transition. Amtrak officials do not
believe the current brake problems will impact the October 2006
transition date, however.
Although the settlement agreement ensures that Amtrak will be protected
by the extended trainset warranties and Amtrak has several methods of
financial recourse, if the Consortium does not honor warranties, loss
of revenue resulting from removal of trainsets from revenue service is
not directly recoverable. For example, the settlement agreement
included the extension of "bumper to bumper" trainset warranties on all
trainsets for the next 5 months, until October 1, 2005. In addition,
modifications to the trainsets that are currently under way or planned
will be under warranty for 2 years after they are completed to Amtrak's
satisfaction. Amtrak also has several methods of financial recourse, if
the Consortium does not honor warranties, including letters of credit
that Amtrak may draw down. However, the full extent of the legal
liability associated with the April 2005 brake problem has yet to be
addressed by the parties. Amtrak officials told us that their first
priority is getting the trainsets back in service. Amtrak is
considering a number of possible actions regarding the brake problem,
including assessing liquidated damages.[Footnote 15]
Challenges In Managing Other Large-Scale Projects:
As we reported in February 2004, Amtrak did not effectively manage the
entire NHRIP project, of which Acela was a part.[Footnote 16] Among the
problems we found were that (1) Amtrak's management of this project was
not comprehensive but was focused on the short term; (2) project
management focused on separate components of the project, such as
electrification and acquisition of the high-speed trains, and not the
project as a whole; and (3) did not sufficiently address major
infrastructure improvements needed to attain project trip-time goals.
We also found that Amtrak lacked a comprehensive financial plan for the
project and that Amtrak did not fully integrate stakeholder interests
(commuter rail authorities and state governments), even though work
that involved stakeholders was critical to achieving project goals. The
overall results of this poor management was that many critical elements
of the project were not completed, project costs and schedules
increased considerably, and the project goal (3-hour trip time from
Boston to New York City) was not attained. While there have been many
benefits from the NHRIP, including faster trip times between Boston and
New York City, Amtrak's management of this project clearly demonstrates
that Amtrak had difficulty keeping such a large-scale project focused,
on-time, and on-budget.
We also have ongoing work for this committee on Amtrak'management and
performance issues that we plan to report on later this year.
Mr. Chairman, that concludes my statement. I would be happy to answer
any questions you or the Members of the Subcommittee might have.
Contacts and Acknowledgements:
For further information, please contact JayEtta Z. Hecker at
heckerj@gao.gov or at (202) 512-2834. Individuals making key
contributions to this statement include Kara Finnegan Irving, Bert
Japikse, Richard Jorgenson, and Randall Williamson.
[End of section]
Related GAO Products:
Intercity Passenger Rail: Issues Associated with the Recent Settlement
between Amtrak and the Consortium of Bombardier and Alstom, GAO-05-152
(Washington, D.C.: Dec. 1, 2004).
Intercity Passenger Rail: Amtrak's Management of Northeast Corridor
Improvements Demonstrates Need for Applying Best Practices, GAO-04-94
(Washington, D.C.: Feb. 27, 2004).
Intercity Passenger Rail: Amtrak Needs to Improve Its Decisionmaking
Process for Its Route and Service Proposals, GAO-02-398 (Washington,
D.C.: Apr. 12, 2002):
Intercity Passenger Rail: Potential Financial Issues in the Event That
Amtrak Undergoes Liquidation. GAO-02-871 (Washington, D.C.: Sept. 20,
2002).
Financial Management: Amtrak's Route Profitability Schedules Need
Improvement, GAO-02-912R (Washington, D.C.: July 15, 2002).
Intercity Passenger Rail: Congress Faces Critical Decisions in
Developing a National Policy, GAO-02-522T (Washington, D.C.: Apr. 11,
2002).
Intercity Passenger Rail: The Congress Faces Critical Decisions About
the Role of and Funding for Intercity Passenger Rail Systems, GAO-01-
820T (Washington, D.C.: July 25, 2001).
Intercity Passenger Rail: Amtrak Will Continue to Have Difficulty
Controlling Its Costs and Meeting Capital Needs, GAO/RCED-00-138
(Washington, D.C.: May 31, 2000).
Intercity Passenger Rail: Issues Associated With a Possible Amtrak
Liquidation, GAO/RCED-98-60 (Washington, D.C.: Mar. 2, 1998).
FOOTNOTES
[1] See the enclosure for a list of related GAO products.
[2] GAO, Intercity Passenger Rail: Issues Associated with the Recent
Settlement between Amtrak and the Consortium of Bombardier and Alstom,
GAO-05-152 (Washington, D.C.: Dec. 1, 2004).
[3] For a more detailed description and discussion of NHRIP and the
Northeast Corridor Improvement Project, see GAO, Intercity Passenger
Rail: Amtrak's Management of Northeast Corridor Improvements
Demonstrates Need for Applying Best Practices, GAO-04-94 (Washington,
D.C.: Feb. 27, 2004).
[4] The cost of the Management Service Contract is not included in the
total contract cost.
[5] As of April 2004, Amtrak had paid NecMSC a total of $31 million for
its maintenance and management services. This amount is adjusted for
liquidated damages Amtrak has assessed to NecMSC.
[6] This is a mechanism that allows trains to take curves at a higher
speed.
[7] It should be noted that during 1993, existing high-speed trains
such as the X-2000 and InterCity Express were tested on the Northeast
Corridor. One of the bidders for the high-speed train contract proposed
a slightly modified version of the X-2000 train but was not selected.
[8] Push-pull operation is when a locomotive "pulls" the train in one
direction and then the locomotive "pushes" the train in the opposite
direction. According to FRA, this is common in commuter rail
operations.
[9] As we reported in February 2004, Amtrak had not yet met the
requirement for achieving the 3-hour trip time contained in the Amtrak
Authorization and Development Act. See GAO-04-94. It should be noted
that Amtrak did not agree with our use of FRA's 1994 master plan to
measure the effectiveness of its management of NHRIP, even though
Amtrak officials had agreed that this plan was a "blueprint" for the
project.
[10] This discussion of Acela testing is not meant to imply that the
trainsets are unsafe or do not meet federal safety standards. Rather,
it focuses on the degree of testing to discover problems and defects
that could potentially be fixed prior to deployment into revenue
service.
[11] An FRA official acknowledged that the Center was not conducive to
testing Acela's tilt mechanism. However, he said that other problems
that developed during testing at the Center should have been a clear
signal that additional testing was warranted.
[12] According to FRA, in lieu of high-speed testing standards, Amtrak
developed its own minimum testing requirements.
[13] For a more detailed information on the lawsuits and settlement,
see GAO-05-152.
[14] According to Amtrak, this measure is calculated as a 6-month
rolling average. The settlement agreement requires the Consortium to
meet this reliability standard before the transition will occur and
Amtrak may draw down on letters of credit issued by the Consortium
should it default and not meet the requirement.
[15] Amtrak officials said that, because the Acela trains have been
removed from service, they are not currently paying NecMSC the fixed
mileage rate for its services.
[16] See GAO-04-94.